Update on Equity Crowdfunding and Tax Exemptions for PPP Projects in Turkey

At the end of October, we notified our subscribers about a draft law entitled the “Draft Law on the Amendment of Certain Tax Laws, Laws and Decree Laws” (the “Draft Law”) which anticipated introducing, among others, (i) a regulatory framework for equity crowdfunding, and (ii) certain tax exemptions relating to the financing of public-private partnership projects in Turkey (the “PPP Projects”).

Since our last update, the Draft Law has been adopted by the Turkish Parliament, ratified by the President and published in the Official Gazette dated 5 December 2017 to give effect to the relevant provisions thereunder. Accordingly,

• entities established to offer securities to the public outside of Turkey in order to provide funds to the project companies of PPP Projects are now exempt from (i) stamp duty and (ii) administrative fees and expenses with respect to documents and transactions relating to the financing of the project companies for PPP Projects through funds earned from the sale of securities abroad, repayment thereof and provision of security thereunder; and
• entities shall be eligible to sell equities through online platforms to be licensed by the Capital Markets Board of Turkey (the “CMB”) and under terms and conditions to be regulated by the CMB through the issuance of secondary legislation.

We will keep our subscribers updated as soon as the CMB publishes draft regulations for equity crowdfunding.